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Uber opens at $42 per share

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Re: Uber opens at $42 per share

#401

Post by ytpete »

Blackthorn wrote: post #383
akchin wrote: post #267

Earlier quoted context omitted.

It shouldn't matter a lot since I am 99% sure that they were issuing RSUs at that time and not options. So the strike price based on 3-years ago valuation is not relevant. Also, I am sure the number of RSUs you got at Uber should have been more than the RSUs at FAANG, to compensate for some of the risks. Now, if an individual Uber employee came out ahead, vs. having joined a FAANG really depends on the offers they ha…

It matters a ton. You get your rsu grant sized based on the stock price at the time of the grant, just like options. If that price goes up, you make money... Just like options.

It's not just like options though, is the point they were making - if the price goes down, you still make money with RSUs, just not as much.

Re: Uber opens at $42 per share

#402

Post by sfifs »

foobarian wrote: post #378
busymom0 wrote: post #304

There's way too many comments in this thread comparing Uber's non-profitability to Amazon's which I think is quite silly. Amazon lost $2.8 billion over its first 17 quarters while Uber lost $4.5 billion in 2017 alone. Also comparing Uber to Facebook is quite silly too. Facebook had a lot more users than Uber but they are also different types of users. One is a free user with hope for targeted advertisement (in which…

> Also advertisement has huge margins with not much cost from Facebook's pov but ride sharing logistics is completely different with very little margin where the driver needs to get paid Why is this? In both cases it seems the cost is paying a bunch of servers and engineers to run a website. So why is Facebook seemingly more efficient?

Nope. Market share and pricing power in digital advertising comes from user base and targeting capability. As an advertiser, I can reach most of the population in many country through FB/IG and YouTube. Their targeting data is also pretty good. So they claim a lion's share of the market. Also inventory expands as userbase expands and the userbase doesn't really have other options with similar network effects.

Uber on the other hand has plenty of competition. Their total cost to user has to be competitive vs. not just taxis but possibly owning a car. There's only so much they can charge for a ride and they pay a ton of incentives to get drivers to drive for them in many markets. So the available space for profitability is constrained.

Re: Uber opens at $42 per share

#403

Post by mattmanser »

TazeTSchnitzel wrote: post #331
asdff wrote: post #215

Earlier quoted context omitted.

Uber isn't rolling profit back into the company like Amazon or others do, they are literally loosing money on every ride. There's no profit to hide from the taxman.

Right. Amazon is and has been accumulating a massive vertically-integrated empire of physical infrastructure they actually own or lease. Uber is accumulating… uh. Microservices? Negative goodwill?

Markets, it's acquiring markets. I'm no Uber fan, but come on, they're moving into more and more cities world-wide, often without competition save the local taxi firms.

Re: Uber opens at $42 per share

#404

Post by JMTQp8lwXL »

rhizome wrote: post #377
JMTQp8lwXL wrote: post #335

Earlier quoted context omitted.

With that strategy, Uber might run out of cash before the competition is crushed.

They are way into debt financing and have a $25B bottom line, this is a "when you owe the bank a million dollars..." situation now, nobody involved is going to let it run out of money and throw the whole house of cards away.

Correct me if I'm wrong, but that sounds like sunk cost fallacy.

Re: Uber opens at $42 per share

#405

Post by matt4077 »

mattmanser wrote: post #403
TazeTSchnitzel wrote: post #331

Earlier quoted context omitted.

Right. Amazon is and has been accumulating a massive vertically-integrated empire of physical infrastructure they actually own or lease. Uber is accumulating… uh. Microservices? Negative goodwill?

Markets, it's acquiring markets. I'm no Uber fan, but come on, they're moving into more and more cities world-wide, often without competition save the local taxi firms.

Except it's not acquiring them so much as renting them, paying each month for the privilege to hold on to the marketshare necessary to also lose money in the next month.

Re: Uber opens at $42 per share

#406

Post by matt4077 »

tuna-piano wrote: post #277
atemerev wrote: post #38

Earlier quoted context omitted.

These days, being profitable is considered harmful. More profits = more taxes. Getting virtual “profits” into stock appreciation and structuring revenues to pay nearly zero tax is the name of the game today, and only big corporations can afford it. It is small and medium businesses that pick the bill.

Same reason I requested $0 salary this year... Seriously, this argument doesn't make sense to me? How can them spending more money help them make more because of taxes?

Yeah, it's a pretty stupid argument that has somehow become one of those contrarian memes people like to use to appear smart.

I guess it's inspired by Amazon's history of reinvesting, but missing the point that Amazon's motive most certainly was to actually invest into growth.

There are of course many companies that engage in all sorts of morally bankrupt but legal tax optimisation strategies. But Uber is rather different from, say, Apple, in that Uber has absolutely no need for creativity to depress their profit. They are haemorrhaging money the old-fashioned and totally legit way.

Re: Uber opens at $42 per share

#407

Post by dragonwriter »

ulfw wrote: post #390
acchow wrote: post #332

Earlier quoted context omitted.

Yes, they want to eat up the whole market until all the competitors die. Then they can raise prices.

And then new competitors will spring up who can undermine those prices. There is absolutely nothing unique about what Uber does to keep people as customers.

A dominant two-sided market has strong network effects, since new suppliers want to be where the buyers already are and vice versa.

Re: Uber opens at $42 per share

#408

Post by TazeTSchnitzel »

mattmanser wrote: post #403
TazeTSchnitzel wrote: post #331

Earlier quoted context omitted.

Right. Amazon is and has been accumulating a massive vertically-integrated empire of physical infrastructure they actually own or lease. Uber is accumulating… uh. Microservices? Negative goodwill?

Markets, it's acquiring markets. I'm no Uber fan, but come on, they're moving into more and more cities world-wide, often without competition save the local taxi firms.

It's achieving temporary local marketshare subsidised by massive losses. The moment Uber charges prices it can actually profit from, its “markets” will vanish.

Re: Uber opens at $42 per share

#409

Post by disgruntledphd2 »

computerex wrote: post #217
criddell wrote: post #93

Earlier quoted context omitted.

I've never understood why so many people were/are so bullish on Uber. I understand that ride hailing is a big deal, but it doesn't feel like it's that hard to launch a new ride hailing company. I'm basing that opinion on what I've seen in my city. When Uber and Lyft left Austin, there were lots of alternatives that had existed or popped up to fill the space. Aside from brand recognition, what does Uber have that the…

> Aside from brand recognition, what does Uber have that the others don't? Brand recognition is no small thing. Hyper growth is what a lot of companies are going for, because that's the model that lead to amazon dominating the world. Ubering being a verb is very valuable.

Hypergrowth from re-investing profits is very different from hypergrowth from kind investors.

One of those leads to massive profit (eventually), and we'll see what happens with Uber.

Re: Uber opens at $42 per share

#410

Post by matt4077 »

malvosenior wrote: post #299
semi-extrinsic wrote: post #270

Earlier quoted context omitted.

I don't see how the UX thing is so revolutionary. I live in a city with 120k people, and the app of the local taxi company here does all of those things as well.

That's not been my experience and definitely not before Uber existed and forced people to start copying them.

That's some exemplary public service by Uber, actually. They may actually deserve their status as a non-profit.
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